Bogdan says 'sequestration will not break this program'

Sep. 17, 2013 - 06:00AM
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One year ago, Lt. Gen. Chris Bogdan, the incoming head of the F-35 joint strike fighter program, got up on stage at the Air Force Association’s national conference and publicly lambasted the contractors working on the Pentagon’s premiere fighter program.

The relationship between the joint program office and the contractors were the “worst I have ever seen,” Bogdan said. Lockheed Martin, the corporate lead, and engine manufacturer Pratt & Whitney needed to shape up.

It was an unexpected shot across the bows of the corporate giants, one that caught attendees by surprise.

Today, Bogdan returned to that stage. A year can change a lot.

“I stood up here a year ago and I threw a hand grenade into the crowd,” Bogdan said at the start of his comments. “That was intentional. It’s been a year later, and a lot of things have changed.”

As an example of that cultural change, Bogdan highlighted the creation of a “cost war-room” set up between Lockheed, Pratt and the JPO. The companies are picking up the tab of the entire operation, with Lockheed providing half a floor at their D.C.-area office for free.

That office will feature cost analysts and experts taking a look at potential cost-savings in maintenance, reliability & maintainability , and the supply chain. Bogdan cited CEO-level buy-in on the project from the companies as proof of a new culture and said he was “cautiously optimistic” it will find good results.

Getting costs out of the program remains a priority, because, as Bogdan said, “If nobody can afford it, [a 5th-generation fighter] does you no good.”

He confirmed that his office estimates sustainment cost for the JSF have dropped to $857 billion, a significant step-down from a figure often cited as $1.1 trillion. That number is from a three-year-old government report, Bogdan said, and the new number reflects a more accurate read on what the program is now.

However, given the dangers of trying to predict costs and inflation of a 50-year period, even that number contains “a lot of assumptions,” Bogdan said.

The fighter came through sequestration “relatively unscathed,” without having to push its planned purchase further down the line. And while fiscal year 2014 is very much up in the air, Bogdan declared it was his commitment “that sequestration will not break this program.”

Along those lines, Bogdan expressed confidence that the JSF would not fall into the dreaded “death spiral,” where purchases would be pushed to the right, causing prices to increase, which in turn would drive customers to cut their orders. That is in large part because international purchases remain strong, including Tuesday’s announcement that the Netherlands was committing to the fighter.